In business, time is money-and when organisations are at the mercy of slow, paperbased invoicing, it's surprising how they can end up wasting an awful lot of both. What is even more surprising is just how easy it is for them to start saving time and money right away, simply by adopting a low-cost, EDI-like approach to electronic invoicing, or e-invoicing. In making the transition from paper to electronic, it is possible for resellers to help their customers reduce monthly invoicing costs significantly, improve working relationships with suppliers, and drive their businesses forward.
Protracted paperbased processes
There is a certain grim reality to todays protracted, paper-based invoicing processes. Let's look at an example of Company X and Supplier Y, one of its 5000 suppliers. Supplier Y generates an invoice on an ERP (enterprise resource planning) system, such as SAP. The invoice is printed out onto paper, which is then folded, inserted into an envelope, sealed, franked (or in a worstcase scenario, stamped manually) and mailed. This is a monotonous procedure that can take hours, if not days, for multiple invoices, and can cost between 1 and 3 pounds sterling per invoice.
Then Supplier Y waitsIf it doesn't get a receipt for the invoice, it doesn't know if the invoice has been received. It can cost as much as 40 pounds per invoice in time wasted and costs associated with chasing it.
Company X undertakes the same process as Suppler Y, but in reverse. Accounts Payable staff open the envelope, unfold and read the invoice, then rekey data into a financial package or ERP system. Rekeying invoice data has a number of costly drawbacks-apart from being time consuming and monotonous (especially if the company has 5000 suppliers), data entry errors can occur and can lead to disputed invoices, late payment penalties and declining supplier relationships. In addition, paper invoices need to be filed and archived, which is time- and spaceconsuming, as well as costly. The whole process can cost asmuch as 10 per invoice.
invoicing is the answer-right?
So, electronic, or e-invoicing- whereby invoices are sent and received electronically - is the answer, right? Well, yes-but its not quite as simple as that. In fact, there are many challenges that have to be considered and addressed before a company can go down an e-invoicing route with its suppliers.
To meet these challenges, many companies have adopted an electronic data interchange (EDI) approach, they recognised the potential business benefits of EDI, however many found it to be extremely expensive and time-consuming to actually implement.
This was the opportunity that ReadSoft saw. Basically, when we looked at the above challenges we tried to work out how we could get different ERP systems to communicate easily and cost-effectively. This led to the development of our EZ-OUT product.
Firstly, we came to the conclusion that, regardless of the ERP system, there is one industry standard-communicating to a printer. This is how EZ-OUT was born-it is effectively an intelligent print driver. Secondly, we needed some sort of mechanism to communicate by, and we decided that email was a very low cost and established communication method.
EZ-OUT, part of a total solution called ReadSoft DOCUMENTS for EDI, has been designed to integrate with ReadSoft's DOCUMENTS for INVOICES software, which gathers all of a company's invoices, on paper or in electronic form, finds the correct information from them, and puts this into the company's business system. If a company has ReadSofts DOCUMENTS for INVOICES installed it can then provide its suppliers witha low-cost EZ-OUT 'client' for sending out invoices out by email.
No change to business processes
The smart thing about EZ-OUT is that an organisation doesn't have to change any of its business rules or processes to implement e-invoicing. And EZOUT is extremely low cost-at around 300 per licence; a
supplier only has to make a small investment to:
meet the e-invoicing needs of a customer
reduce printing and postage costs significantly
have a faster and more secure delivery mechanism, and
achieve improved management and financial controls.
From a reseller's point of view, selling a ReadSoft DOCUMENTS for INVOICES solution to a customer then enables opportunities through the EZ-OUT solution to continue making sales to the customer's suppliers. We are interested in hearing from any resellers interested in pursuing these opportunities.